Bank Fraud Statue Clarified by the Supreme Court in Shaw v. United States
The United States Supreme Court, in a unanimous decision in Shaw v. United States, clarified the federal Bank Fraud statute. The Court rejected defendant Lawrence Shaw’s argument that such statute did not apply to him because he intended only to cheat a bank customer, not the bank itself.The bank fraud statue in question makes it a crime when a person: “knowingly executes, or attempts to execute, a scheme … to defraud a financial institution.” 18 U.S.C. §1344(1).
Shaw was convicted of violating this statute when he stole money from Stanley Hsu. He was accused of defrauding Hsu out of money by using his bank account numbers to transfer funds from Hsu’s account to accounts at other banks, which Shaw controlled. 580 U.S. at ___ (2016).
The Court brings clarity to the meaning of the statute in the following ways:
Fraudulent schemes to steal money from a bank customer’s account is a fraudulent scheme to defraud the bank.
The Court determined that a scheme to fraudulently obtain funds from a bank depositor’s account is also a scheme to fraudulently obtain property from a financial institution, at least in Shaw’s scheme where Defendant:
• knew that the bank held the deposits;
• the funds obtained came from the deposit account; and
• the defendant misled the bank in order to obtain the funds. Id. at 3.
To violate the bank fraud statute, it is not necessary to intend harm to the bank or cause the bank financial harm.
Shaw argued that he did not intend to cause the bank financial harm, and indeed the parties agreed that the bank suffered no financial harm. However, the Court found that violating this section of the Bank Fraud Statute does not require a showing of intent to cause financial loss or a showing of actual financial loss. Id. 3.The Court’s ruling in Shaw could have sweeping implications on future convictions under the bank fraud statute.
If you have been accused of bank fraud, or other financial crimes, you need an experienced attorney to protect your rights. Our attorneys will work hard to provide you with the best possible defense. Contact us or call (480) 219-1366 for a free case evaluation.
The attorneys at Ashley D. Adams, PLC handles state criminal cases throughout Arizona and federal criminal cases throughout the United States, including Arizona, Oklahoma, Utah, and California.